Which of these describes individuals that want goods and services for personal consumption and have the resources to buy them quizlet?

How the Footprint Works

Ecological Footprint accounting measures the demand on and supply of nature.

On the demand side, the Ecological Footprint adds up all the productive areas for which a population, a person or a product competes. It measures the ecological assets that a given population or product requires to produce the natural resources it consumes (including plant-based food and fiber products, livestock and fish products, timber and other forest products, space for urban infrastructure) and to absorb its waste, especially carbon emissions.

The Ecological Footprint tracks the use of productive surface areas. Typically these areas are: cropland, grazing land, fishing grounds, built-up land, forest area, and carbon demand on land.

On the supply side, a city, state or nation’s biocapacity represents the productivity of its ecological assets (including cropland, grazing land, forest land, fishing grounds, and built-up land). These areas, especially if left unharvested, can also serve to absorb the waste we generate, especially our carbon emissions from burning fossil fuel.

Both the Ecological Footprint and biocapacity are expressed in global hectares—globally comparable, standardized hectares with world average productivity.

Each city, state or nation’s Ecological Footprint can be compared to its biocapacity, or that of the world.

If a population’s Ecological Footprint exceeds the region’s biocapacity, that region runs a biocapacity deficit. Its demand for the goods and services that its land and seas can provide—fruits and vegetables, meat, fish, wood, cotton for clothing, and carbon dioxide absorption—exceeds what the region’s ecosystems can regenerate. In more popular communications, we also call this “an ecological deficit.” A region in ecological deficit meets demand by importing, liquidating its own ecological assets (such as overfishing), and/or emitting carbon dioxide into the atmosphere. If a region’s biocapacity exceeds its Ecological Footprint, it has a biocapacity reserve.

Conceived in 1990 by Mathis Wackernagel and William Rees at the University of British Columbia, the Ecological Footprint launched the broader Footprint movement, including the carbon Footprint, and is now widely used by scientists, businesses, governments, individuals, and institutions working to monitor ecological resource use and advance sustainable development. The most prominent calculations are those produced for countries. We call those the National Footprint and Biocapacity Accounts.

A rich and accessible introduction to the theory and practice of the approach is available in the book Ecological Footprint: Managing Our Biocapacity Budget (2019). The European Commission provides a short summary here. Fuller methodological explanations and applications to national policy are available in a Nature Sustainability paper (2021), an two MDPI papers, one on the national accounts method, and the other one on its implications.

What Is Economic Efficiency?

Economic efficiency is when all goods and factors of production in an economy are distributed or allocated to their most valuable uses and waste is eliminated or minimized.

Key Takeaways

• Economic efficiency is when every scarce resource in an economy is used and distributed among producers and consumers in a way that produces the most economic output and benefit to consumers.
• Economic efficiency can involve efficient production decisions within firms and industries, efficient consumption decisions by individual consumers, and efficient distribution of consumer and producer goods across individual consumers and firms.
• Pareto efficiency is when every economic good is optimally allocated across production and consumption so that no change to the arrangement can be made to make anyone better off without making someone else worse off.

Economic Efficiency

Understanding Economic Efficiency

Economic efficiency implies an economic state in which every resource is optimally allocated to serve each individual or entity in the best way while minimizing waste and inefficiency. When an economy is economically efficient, any changes made to assist one entity would harm another. In terms of production, goods are produced at their lowest possible cost, as are the variable inputs of production.

Some terms that encompass phases of economic efficiency include allocative efficiency, productive efficiency, distributive efficiency, and Pareto efficiency. A state of economic efficiency is essentially theoretical; a limit that can be approached but never reached. Instead, economists look at the amount of loss, referred to as waste, between pure efficiency and reality to see how efficiently an economy functions.

Economic Efficiency and Scarcity

The principles of economic efficiency are based on the concept that resources are scarce. Therefore, there are not sufficient resources to ensure that all aspects of an economy function at their highest capacity at all times. Instead, scarce resources must be distributed to meet the needs of the economy in an ideal way while also limiting the amount of waste produced. The ideal state is related to the welfare of the population with peak efficiency also resulting in the highest level of welfare possible based on the resources available.

Efficiency in Production, Allocation, and Distribution

Productive firms seek to maximize their profits by bringing in the most revenue while minimizing costs. To do this, they choose the combination of inputs that minimize their costs while producing as much output as possible. By doing so, they operate efficiently; when all firms in the economy do so, it is known as productive efficiency.

Consumers, likewise, seek to maximize their well-being by consuming combinations of final consumer goods that produce the highest total satisfaction of their wants and needs at the lowest cost to them. The resulting consumer demand guides productive (through the laws of supply and demand) firms to produce the right quantities of consumer goods in the economy that will provide the highest consumer satisfaction relative to the costs of inputs. When economic resources are allocated across different firms and industries (each following the principle of productive efficiency) in a way that produces the right quantities of final consumer goods, this is called allocative efficiency.

Finally, because each individual values goods differently and according to the law of diminishing marginal utility, the distribution of final consumer goods in an economy are efficient or inefficient. Distributive efficiency is when the consumer goods in an economy are distributed so that each unit is consumed by the individual who values that unit most highly compared to all other individuals. Note that this type of efficiency assumes that the amount of value that individuals place on economic goods can be quantified and compared across individuals.

Economic Efficiency and Welfare

Measuring economic efficiency is often subjective, relying on assumptions about the social good, or welfare, created and how well that serves consumers. In this regard, welfare relates to the standard of living and relative comfort experienced by people within the economy. At peak economic efficiency (when the economy is at productive and allocative efficiency), the welfare of one cannot be improved without subsequently lowering the welfare of another. This point is called Pareto efficiency.

Even if Pareto efficiency is reached, the standard of living of all individuals within the economy may not be equal. Pareto efficiency does not include issues of fairness or equality among those within a particular economy. Instead, the focus is purely on reaching a point of optimal operation regarding the use of limited or scarce resources. It states that efficiency is obtained when a distribution exists where one party's situation cannot be improved without making another party's situation worse.

Which of the following describes individuals that want goods and services for personal consumption and have the resources to buy them quizlet?

What consists of all the techniques sellers used to persuade consumers to buy their goods and services?

What is defined as developing a unique mix of goods and services for each individual consumer?

What is based on three elements a customer orientation a service orientation and a profit orientation?